Current Ratio vs. Quick (acid test) Ratio and Inventory

  • Creator
    Topic
  • December 4, 2013 at 3:59 pm #182213
    Spur
    Member

    Can someone please confirm for me that you are supposed to subtract out inventory from the Quick ratio and not the current ratio. I’ve seen contradicting answers to this in the Wiley material.

    Thanks!

    FAR - Bad Fail '11, Fail '12, Fail '13, PASS It's a miracle!
    AUD - Fail, PASS!!!!!!!!!!!!!!!!!!!!!!!
    BEC - PASS!!!!!!!!
    REG - PASS!!!!!!!! And I'm done!

Viewing 4 replies - 1 through 4 (of 4 total)
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  • December 4, 2013 at 4:05 pm #482682
    NYIACCT89
    Member

    @Spur, that is correct. Also remember to subtract out any prepaid assets as well when calculating the quick ratio.

    FAR - 7/1/13 - 98
    AUD - 8/31/13 - 94
    BEC - 11/23/13 - 89
    REG - 1/13/14 - 86

    Study Materials:
    Becker - Online Course and Flash Cards

    December 4, 2013 at 4:05 pm #482694
    NYIACCT89
    Member

    @Spur, that is correct. Also remember to subtract out any prepaid assets as well when calculating the quick ratio.

    FAR - 7/1/13 - 98
    AUD - 8/31/13 - 94
    BEC - 11/23/13 - 89
    REG - 1/13/14 - 86

    Study Materials:
    Becker - Online Course and Flash Cards

    December 4, 2013 at 4:09 pm #482684
    Spur
    Member

    Thanks!

    FAR - Bad Fail '11, Fail '12, Fail '13, PASS It's a miracle!
    AUD - Fail, PASS!!!!!!!!!!!!!!!!!!!!!!!
    BEC - PASS!!!!!!!!
    REG - PASS!!!!!!!! And I'm done!

    December 4, 2013 at 4:09 pm #482696
    Spur
    Member

    Thanks!

    FAR - Bad Fail '11, Fail '12, Fail '13, PASS It's a miracle!
    AUD - Fail, PASS!!!!!!!!!!!!!!!!!!!!!!!
    BEC - PASS!!!!!!!!
    REG - PASS!!!!!!!! And I'm done!

  • Author
    Replies
Viewing 4 replies - 1 through 4 (of 4 total)
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